Sometimes, it can feel like an uphill struggle to save up a large enough deposit to borrow as much as you need for your mortgage.
That might explain why a survey by Love Money recently found that nearly half of its respondents would lie in order to secure the mortgage deal they wanted.
Is it a good idea?
Perhaps unsurprisingly, it’s never a good idea to lie on your mortgage application, or at any stage during the mortgage process. It may sound cliché, but lying will usually catch up with you – and it could cost you dearly.
Lying about anything from the number of credit agreements you have, to your total debt or your gross income will ultimately have repercussions if your mortgage provider finds out.
At the end of the day, it’s not worth lying, as the penalties for doing so are severe. For one, deceiving a lender is fraud and you could face criminal charges and a criminal record, which can affect your chances of getting a job and of taking out further credit in the future. Not only this, but falsifying figures such as your spending habits in order to borrow more money can also result in your mortgage being invalidated if you’re found out.
The implications of borrowing more than you can afford to repay
Don’t forget that the reason there are rules in place and that lenders must check your income and expenditure is to protect you – nobody wants to take a mortgage out that they can’t actually afford. Lying about your finances so that you can borrow more than you can realistically afford to pay back will stretch your finances and put strain on your everyday life. If you are struggling to meet your mortgage repayments each and every month, there’s a real likelihood that you’ll be unable to pay at some point and will slip into arrears as a result. This can lead to damage to your credit history, additional charges from your lender and, in the worst case scenario, it could mean you lose your home.
This is why it’s vital you tell the truth on your mortgage application, as not doing so could affect you in more ways than one. Taking the extra time to save up a larger deposit means you have a better chance of borrowing what you need to get the property you want without the repayments being unmanageable.
But what if I don’t get caught?
The chances that you won’t get caught are very slim, as mortgage providers have a responsibility to check their customers are able to repay what they’ve borrowed without their money being stretched too far. And, as your credit history will be checked prior to being accepted, you may be found out sooner than you expect.
If you don’t get caught initially, it’s very likely you’ll be found out at some stage. This can happen through a simple credit check, or through the Mortgage Verification Scheme – which holds information about your income and employment.
Remember – however much you want to buy your dream home, it isn’t worth committing fraud!
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Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender.